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Sendo has reacted with surprise to the action which it described as "unprovoked and unnecessary".

Hugh Brogan, chief executive of Sendo, told El Reg the companies had been in discussion over the technology at issue, "...and all of a sudden this legal action arrives. We have not signed the licence [for the technology] because we do not think it is fair." Brogan claimed that the royalty payments Ericsson proposed could be as high as a double digit percentage of sales price.

Brogan explained that Sendo recently made a complaint to the European Commission accusing Ericsson of "seeking to license its patents to third parties on an unfair, anti-competitive, abusive and discriminatory basis".

He added: "We think this is a response to our complaint." Sendo has sent documents to the European Competition Commission to support its claim that Ericsson is in breach of articles 81 and 82 of the EC Treaty.

A spokesman for Ericsson denied the lawsuit was a reaction to Sendo's complaint. "We have patent agreements with most of the world's manufacturers... we have talked to Sendo for some time but now we had to take action," he said.

Ericsson claims Sendo is infringing its patents in three territories - Britain, Germany and the Netherlands. The handset maker wants an injunction to stop Sendo selling phones and monetary damages. The patents cover GSM and GPRS technology.

GSM standards were set by the European Commission with the help of industry. Any intellectual property included in the standard is expected to be offered to all firms on a "fair, reasonable and non-discriminatory" basis.